The Czech crown has experienced a week of initial strengthening against major global currencies. Compared to the previous day’s closing, it gained seven cents against the euro, reaching CZK 23.68 to the euro. Additionally, it improved by 22 cents against the dollar, trading at CZK 22.06 to the dollar as of 17:00. This information comes from the Patria Online website. Conversely, the Prague Stock Exchange has weakened for the fifth consecutive time.
Jaroslav Tupý, an analyst from Purple Trading, commented, “The Czech crown is holding steady at weaker levels around 23.70 EUR/CZK. The Czech crown’s depreciation is primarily driven by negative sentiment towards risk assets and the strengthening of the US dollar.”
Currently, the market is eagerly awaiting the release of May’s inflation data, which will be published by statisticians on June 12. In April, consumer prices in the Czech Republic rose by 12.7 percent year-on-year, following a 15 percent increase in March. Tupý expects that the inflation rate for May could fall below 10 percent.
On Thursday, the PX stock index declined by 0.26 percent, reaching 1,293.32 points. This decline was primarily influenced by financial stocks, particularly the shares of insurance company VIG. However, energy company CEZ managed to break its losing streak, as indicated by data from the stock exchange website.
VIG securities have been on a downward trend since the beginning of the week and fell by 2.07 percent to 568 crowns on this day. Komerční banka saw a decline of 0.38 percent, with its shares valued at 659 crowns, while Moneta Money Bank experienced a decrease of 0.25 percent, settling at 79 crowns. On the other hand, Erste Bank saw a rise of 0.64 percent, with its shares reaching 726.60 crowns.
CEZ shares had fallen below 1,000 crowns on Wednesday. Bohumil Trampota, an analyst at Komerční banka, noted, “They continued to decline today but reversed the negative trend in the last third of trading. The price closed exactly at the significant level of CZK 1,000,” Ultimately, the stock closed with a gain of 0.15 percent.
Over the past three weeks, CEZ shares have experienced an 18.4 percent write-off. Trampota attributes this sell-off to news regarding a government-approved amendment on business corporation transformations, specifically relating to a split by spin-off with the termination of participation by all minority shareholders and a split with an unequal exchange ratio. Trampota commented, “This situation is highly opaque and uncertain, and it acts as a red flag for investors. Who would want to buy or hold shares during such times?” Despite recent weakness, CEZ shares have gained nearly 30 percent since the beginning of the year.
